The rediscovered Pearl of the Orient

World Economic Forum founder Klaus Schwab said, in an interview, that President Aquino is creating a governance system which corresponds to the expectations of the 21st century. He pointed to the fight against corruption and the increased transparency of the Philippine government as major achievements. He said: “The Philippines is the undiscovered Pearl of the Pacific.” And then added: “Aquino has made a difference.”

Business leaders who came from all over the world to attend the World Economic Forum East Asia in Manila said that while much had to be done, it was very possible that the Philippines would be the next economic miracle.

International correspondents who attended the WEF were almost unanimous in praising the Philippines, once deemed an “economic laggard,” as now the fastest growing economy in Asia. One foreign reporter said that he interviewed P-Noy in 2010. His first impression was a person with a “charisma deficit.” According to him, he had difficulty believing when “Aquino said that during his term he would lessen corruption, increase economic growth and increase tourism.” But then, the reporter said that coming back after four years, he can only say: “He did it.”

Andrew Stevens of CNN talked of the resilience of the Filipino people and the Philippine economy. He especially cited that the growth of the Philippines was sustainable because it was a “balanced economy,” referring to the combination of increasing exports, overseas remittances, consumer spending and BPOs.

The discordant voices came from certain Filipino sectors who proclaimed their opposing views on the streets and in media. These views came from two types of groups.

There are those whose political or ideological interests would be severely hurt if the Philippines becomes the next economic miracle. And they come from  opposing sides of the political spectrum.

On one side are those who still mouth the outdated slogans of anti-imperialism and anti-capitalism. They even call the WEF a capitalist tool, forgetting that even Communist countries like China and Vietnam are WEF members. In fact this organization has a permanent office in Beijing. Once the capitals of Marxist ideologies, China and Russia now have stock exchanges, the quintessential symbols of capitalism. But television cameras seem to attract these types like nectar for bees.

But the opportunity to posture before television cameras will certainly disappear when the Philippines  becomes  a tiger economy.

While the world believes that the Philippines is poised for a real economic take off, there are those who proclaim that this country is already a failed state or, at least, on the verge of becoming one. While some may sincerely believe what they are saying, there are others whose belief is fuelled by their desire to return to power after being  deposed. Then again, there are still remnants of the feudal politicians whose political power will be endangered by the economic empowerment of the voters.

For example, the public may be solidly supporting the Daang Matuwid crusade of P-Noy, but there are powerful economic and political interests who will oppose it because their power and wealth will suffer. Obviously this will include “jueteng” lords, rice smugglers, tax evaders and lawmakers who were enriched by PDAF schemes. Their influence, through the use of money and power, go beyond political groups. As the Ben Hur list has shown, the Napoles beneficiaries include media personalities, judges and even Catholic priests.

But there are also those who sincerely feel that there has not been enough progress, and much more needs to be done. It is this group of people who deserves to be listened to and whose questions should be answered.

To this group, they need to accept that their questions cannot be answered without citing statistics. It is a fact that the Philippines has either the fastest or second fastest economic growth rate in Asia, averaging 7.2% annually. But even though we have the fastest growth rate in terms of percentages, our starting point in terms of per capita or gross domestic product (GDP) in terms of dollars is much lower than even certain neighboring countries.

So if we compare the Philippine per capita GDP (approx. $3,000), this is higher than the per capita GDP of Pakistan ($1,350), India ($1,7000) and Vietnam ($1,920). However, if we compare ourselves to Thailand, its economic growth rate is less than 4% and with its military coup might even have a recession. But their  per capital GDP is $6,180,  twice the size of our country. Therefore, even with a recession, the Thai economy will remain richer, on a per capita basis, until we can catch up.

Supposing we are able to accelerate our economic growth rate so we grow faster than 7%, we may be able to have a per capita of $10,000 within a decade. However note that right now the per capita GDP of Malaysia is already $11,700. Klaus Schwab, WEF founder, stated the reality that even if we are able to sustain our present growth rate, we will only be a middle income level country by 2030.

Let’s look at two other countries. South Korea has a growth rate of only 3.4% but its per capita GDP is already $25,700. Taiwan has growth rate of only 3.3% but its per capita GDP is already $21,700.

We are suffering the consequences of being the sick man of Asia for so many years. This is the status we earned because our economy was ravaged and pillaged by the Marcos dictatorship.

If we are to aspire to be a nation whose people will be as prosperous as our wealthiest neighbors, we need to have a sustainable and even higher growth rate than the present 7.0% to 7.5%. This can be done if the vast majority of the Filipino people ignore the cynicism of the few in media, in politics, or in the streets waving red flags and work together. It can be done if we believe in the undiscovered greatness of our people. Perhaps we can gain inspiration from the closing paragraph of P-Noy’s speech at the World Economic Forum:

“For the longest time, it has been the patriotism, the willpower and the wisdom of Filipino people that has rescued our people from its darkest moments. And now they have public servants in government fully committed to harnessing their power for good — for the betterment of our nation — our country has the social and economic momentum to go from success to success, and truly make waves throughout our archipelago, in the international community and in the vast, immeasurable ocean of history.”

Indeed, the Philippines — the rediscovered Pearl of the Orient — can be the next economic miracle.  

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Email: elfrencruz@gmail.com